Court case at end of four-year feud hears contested allegations of financial mismanagement and ‘clandestine relationships’ between practice principal and junior staff


 In the four years since the celebrated Iraqi-born architect died suddenly in March 2016, a “toxic dispute” has been taking place between the executors of her estate, with claims and counterclaims filed over the interpretation of her wishes and the future of her architecture practice. The long-running feud has finally been settled in an explosive court hearing involving contested allegations of financial mismanagement, disregard for corporate governance and “clandestine relationships” between the current practice principal and junior members of staff.

In a remote hearing conducted via Skype, the court was told that, after years of negotiations, the four executors of Hadid’s will trust had finally reached an agreement over the distribution of her estate, which is now valued at around £100m – bar one detail. The agreement will see the bulk of Hadid’s assets go to the Zaha Hadid Foundation, a charitable body, with plans to establish a museum and award scholarships, focused on supporting the architectural education of Arab women in particular.

Meanwhile, shares in the architecture practice, Zaha Hadid Ltd (ZHL), are to be transferred to a tax-efficient employee benefit trust, chaired by her long-term collaborator and practice principal, Patrik Schumacher.1 But the executors remained in deadlock over one point of the trust’s board structure, which was surrendered to the court to decide.

In their submissions, the defendants sought to rely on two damning reports from independent legal investigations that were highly critical of Schumacher’s behaviour. One focused on issues of corporate governance, while the second concerned allegations of his inappropriate relationships with junior staff. Both were prompted by whistleblowing complaints.

....

  • 1. In submissions made to the court, Schumacher, who is also an executor of Hadid’s estate, insisted that he be given personal powers of veto over the company’s board of trustees. His counsel argued that such a move was in line with Hadid’s instruction in her letter of wishes, that he should “be in control of the business” as far as practicable. The other three executors – comprising the stained glass artist Brian Clarke, Hadid’s niece Rana Hadid, and property developer Peter Palumbo – strenuously resisted this request, alleging that Schumacher had a track record of abusing veto powers, had failed to distinguish conflicts of interest and had a “lack of commitment to basic principles of corporate governance”.